Precious Points: B Unbiased

"We've made no secret of viewing the current bullishness as a "sucker's rally" until
proven otherwise, and will continue to seek verification for this view, with
an open mind towards changing our outlook if dictated by price action. The
current advance... could easily extend to the 5-week sma, at about $920. Strong
resistance also exists at $955. Dollar strength seems technical and artificial,
rather than based on strong fundamentals, but may yet last just long enough
to provide the best gold buying opportunity in months." ~ Precious Points:
So Far So Good, May 17, 2008

Though sentiment on the street has become practically one-sided, with the
dollar sinking and oil reaching new records almost daily, last week's action
in precious metals continues to unfold in the expected b wave rally. In fact,
having found support at the still down-trending 50-day sma, in the $920 area,
one more new high to complete c of b is likely.

The irony of counting waves in gold at the moment is the two opposite camps
are both expecting the same short term wave structure and will inevitably interpret
it to their favor. As always, TTC monitors both sides and responds to the market's
decisions. So, as shown below, the blue count sees a three-wave correction
off the recent lows, culminating in a 5-wave move up that will reverse and
produce new lows. The red count represents the view of those who believe the
low is in, and they see the current move as 3 of an upward 5-wave impulse.

The blue count reflects the primary expectation at TTC currently, but an early
sign the impulsive red count may be working would be a prolonged consolidation
in the $915-940 area. As gold approaches overbought in the RSI, it will be
crucial to note whether price reverses sharply, or works off the overbought
condition through sideways range trading. A move back below the 50-day sma
would tend to contraindicate the red impulsive count, but overlap of wave 1
at $890 is needed to invalidate the impulse. TTC is also monitoring counts
which will invalidate the possibility of i of 3 at last week's highs, by far
the most explosively bullish count still working.

Like so many markets today, precious metals will continue to be cued by price
action in oil is now undeniably parabolic. Some may be expecting a similar
move in gold now to ensue, and while such a move is not impossible, if it happens
it's very likely to end as parabolic advances always do: short term traders
able to get out at the top will profit handsomely, while physical buyers who've
chased the rapidly rising price are literally left holding the bag. At this
crucial juncture, an unbiased outlook is more important than ever.

Many readers of this weekly update have already found the wealth of value
available to TTC members, including daily commentary in many markets, including
gold. With so many of our members making back their monthly subscription fees
in days or hours, or less, it's safe to say TTC is simply the best risk/reward
trade available. But now we're set to close our doors Memorial Day weekend
to all but institutional traders - this week you have the opportunity to try
our site absolutely risk free. If you're really serious about trading, learn
more about what TTC has to offer, the time to join is
now.

This update is provided as general information and is not
an investment recommendation. TTC accepts no liability whatsoever for any losses
resulting from action taken based on the contents of its charts, commentaries,
or price data. Securities and commodities markets involve inherent risk and
not all positions are suitable for each individual. Check with your licensed
financial advisor or broker prior to taking any action.